New Lifetime High Reached: Allegiant Travel (ALGT)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Allegiant Travel ( ALGT) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Allegiant Travel as such a stock due to the following factors:

ALGT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $10.4 million.

Allegiant Travel Company, a leisure travel company, focuses on the provision of travel services and products to residents of small cities in the United States. ALGT has a PE ratio of 22.7. Currently there are 7 analysts that rate Allegiant Travel a buy, 1 analyst rates it a sell, and 2 rate it a hold.

The average volume for Allegiant Travel has been 105,900 shares per day over the past 30 days. Allegiant Travel has a market cap of $2.2 billion and is part of the services sector and transportation industry. The stock has a beta of 0.07 and a short float of 4.7% with 7.72 days to cover. Shares are up 20.2% year-to-date as of the close of trading on Wednesday.

TheStreet Quant Ratings rates Allegiant Travel as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, solid stock price performance, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

Highlights from the ratings report include:

The revenue growth significantly trails the industry average of 47.6%. Since the same quarter one year prior, revenues rose by 13.6%. Growth in the company's revenue appears to have helped boost the earnings per share.

ALLEGIANT TRAVEL CO has improved earnings per share by 38.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, ALLEGIANT TRAVEL CO increased its bottom line by earning $4.84 versus $4.05 in the prior year. This year, the market expects an improvement in earnings ($6.03 versus $4.84).

Powered by its strong earnings growth of 38.80% and other important driving factors, this stock has surged by 32.46% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.

Despite the current debt-to-equity ratio of 1.64, it is still below the industry average, suggesting that this level of debt is acceptable within the Airlines industry. Despite the fact that ALGT's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.84 is high and demonstrates strong liquidity.

Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to other companies in the Airlines industry and the overall market on the basis of return on equity, ALLEGIANT TRAVEL CO has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.